FTC Wants to Shut Telemarketing Cos.

Published 8:00 pm, Sunday, February 3, 2002

Federal regulators said they want to shut down an Oklahoma City telemarketing group and have it repay $51 million to customers who were deceived and overcharged in violation of a court order.

The Federal Trade Commission said Monday it had asked a federal judge to charge the companies with contempt. The companies are Diversified Marketing Services Inc., National Marketing Service Inc., NPC Corporation of the Midwest and Magazine Club Billing Service. Officers of the companies have also been named.

In 1996, the FTC charged the telemarketers with lying to customers about the cost of magazine subscriptions, billing them without permission, refusing to cancel subscriptions and threatening consumers' credit ratings. The companies settled the charges by agreeing to stop deceiving people and to repay $1.5 million.

In court papers filed last week, the FTC said the telemarketers have not changed their ways.

"The scope of the defendants' contempt is widespread," the agency said. "It is almost as though defendants erased from their minds that they had been sued."

Daniel Smith, an attorney for the telemarketers, said he was not aware of the latest government charges and could not comment.

The FTC recently said it wants to create a national "do not call" registry, allowing people to stop most telemarketers from calling their homes with a single request. The agency also wants to prevent telemarketers from hiding their identities from consumers' caller ID boxes and keep them from sharing billing information about their customers.

The agency has begun accepting comments from consumers about the proposals.